Federal Court of Australia

QB4 Capital Pty Limited v Wengel (Stay Application) [2026] FCA 1036

ORDERS

THE COURT ORDERS THAT:

1.    The interlocutory application for a stay dated 28 July 2026 be dismissed.

2.    The applicants pay the first respondents’ costs of that interlocutory application.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

Delivered ex tempore

JACKMAN J:

1    This is an application for a stay pending the determination of an application for leave to appeal, and any appeal resulting therefrom, in relation to a judgment delivered by the primary judge on 14 July 2026 in QB4 Capital Pty Limited v Guardian Securities Limited (Final Distribution) [2026] FCA 971. That judgment concerned the final issue left unresolved by his Honour’s reasons delivered on 25 May 2026 in QB4 Capital Pty Limited v Guardian Securities Limited [2026] FCA 704. The outstanding issue concerned the proper construction and possible variation of Order 6 made on 15 February 2024 which was to the following effect:

Subject to the Guardian Indemnity having been discharged in full, the legal costs and expenses the subject of paragraph [3] of the QB4 Claim, (including any appeal that arose from this proceeding) (except for the costs of these proceedings in the period from 13 November 2020 onward) are to be paid to the first applicant and second applicants by the Receivers from the assets of FT1 and FT2 on a lump sum basis.

2    The primary judge explained the ambiguity which arose in relation to that order, and the circumstances in which he had misunderstood that the parties on 12 February 2024 had been advancing what his Honour thought was an agreed position by way of consent orders. As matters transpired, the first respondents (the Receivers) and the applicants were in fundamental disagreement about the meaning and operation of Order 6, which his Honour resolved in the judgment which is the subject of the application for leave to appeal. In short, the primary judge found that the preferable construction of Order 6 was that advanced by the Receivers.

3    The applicants filed an application for leave to appeal yesterday and have applied also for the stay which is the subject of today’s hearing. If the applicants are successful in their appeal, it will have the effect that they would be entitled to an amount of $524,246.09 to be paid out of the assets of FT1 and FT2. The orders which the applicants seek are relevantly as follows:

1.    Until the hearing of this application or further order, the first respondents retain $524,246.09 within the assets of FT1 and FT2.

2.    Until the determination of the application for leave to appeal and any appeal, the order made on 14 July 2026 be stayed to the extent that:

(a)    it authorises distribution of the sum of $524,246.09; and

(b)    the first respondents retain that sum within FT1 and FT2.

3.    The distribution may otherwise proceed, further payments to unitholders being calculated net of the retained sum, with liberty to apply for directions.

4    Much of the argument before me concerned the claimed merits of the application for leave to appeal and any appeal therefrom. I am not as yet persuaded that the proposed appeal enjoys reasonable prospects of success, although I accept that I have not heard argument as fully as the Court will in hearing the leave to appeal application. I am prepared to assume, without deciding, that the proposed appeal enjoys some prospect of success, and is not completely without merit.

5    The applicants point to the adverse consequences if a stay is not granted. It appears that the Receivers intend to distribute the assets of FT1 and FT2 in accordance with the orders of the primary judge within the next month, which will involve payments being made to some 29 beneficiaries of amounts totalling about $8.5 million. The Receivers have taken the position that if the stay is granted, such that they are not entitled to distribute all of the assets of FT1 and FT2 but must retain $524,246.09, then they will not make any distribution at all until the determination of the application for leave to appeal (and any appeal arising from it) because of the complexities in the calculations involved. That stance was not criticised by the applicants, and even if it were, I am not in a position to second-guess the professional judgment of the Receivers in that respect.

6    The point is an important one, because the applicants are not willing to give an undertaking as to damages beyond the consequences of the amount of $524,246.09 alone being retained, and have indicated that they are not willing to give an undertaking as to damages if all of the assets of FT1 and FT2 are retained and not distributed pending the determination of the application for leave to appeal and any appeal from it. In those circumstances, it is not appropriate to grant the stay, for want of an adequate undertaking as to damages concerning the consequences which will ensue from the stay being granted. I therefore dismiss the interlocutory application.

7    The applicants accept that they should pay the costs of the application.

Associate:

Dated:    29 July 2026

SCHEDULE OF PARTIES